Shares in Royal Bank of Scotland Group (LON:RBS) have jumped more than three percent in London this morning, as the blue-chip lender revealed that it had returned to profitability in the second quarter of the year. The bank, bailed out by the UK government during the financial crisis, also signalled that it could move some operations to Amsterdam after Britain leaves the European Union.
As of 08:17 BST, RBS’ share price had added 3.47 percent to 265.10p, outperforming the blue-chip FTSE 100 index which has slipped marginally into the red and is currently 0.03 percent down at 7,472.73 points. The group’s shares have added just under a fifth to their value in the year-to-date, as compared with a 4.5-percent rise in the Footsie.
RBS announced in a statement this morning that it had made an attributable profit of £680 million in the second quarter of the year, as compared with a £1.01-billion loss in the prior-year period. On a half-year basis, the lender’s profit came in at £939 million, from a £2.05-billion loss.
Unlike blue-chip peers Lloyds (LON:LLOY) and Barclays (LON:BARC), RBS did not increase its provision for the payment protection insurance scandal. The lender, however, nevertheless unveiled litigation and conduct costs of £396 million for the first half, including a £151-million charge over a settlement over mis-sold mortgage bonds in the US, and another £25 million in relation to the settlement of the UK 2008 rights issue shareholder litigation.
The BBC meanwhile reported that RBS was in talks with Dutch authorities about locating its European headquarters in Amsterdam after Brexit. The operation would require about 150 staff, with some relocated from London and others hired locally. The blue-chip company already has a licence to operate in the Netherlands, which is a legacy of its purchase of the Dutch bank ABN Amro in 2007.